Question

You believe XCOM stock price willdrop in a month, and you have decided to perform a short sales transaction on 100 shares of XCOM stock at a trade price of $100 per share. The dealer demands short sales interest of $5 for 1 month. Suppose 1 month later, XCOM stock price is 450. What is your profit from this short sales transaction?

Answer 1

	CALCULATION OF THE PROFIT ON SORT SALE
	Sale Value of the Shares =	$                   10,000
		(100 Shares X $ 100 Per shares)
	Less : Purchase price of the Shares at the after one month	$                   45,000
		(100 Shares X $ 450 Per shares)
	Ner loss =	$           -35,000.00
	Less: Interest Payable	$                   500.00
		(100 Shares X $ 5)
	Net loss from this short sale =	$           -35,500.00
	Answer =	$           -35,500.00